Canopy Growth Overhauls Financial Structure

Canopy Growth Corporation has announced several significant changes in its financial structure and board composition. In connection with the creation of non-voting and non-participating exchangeable shares, Greenstar Canada Investment Limited Partnership and CBG Holdings LLC exchanged all 17,149,925 common shares they held for 17,149,925 exchangeable shares. As a result, the CBG Group no longer holds any common shares. Each exchangeable share is convertible into one common share, and they are not publicly traded.

Additionally, the company entered into an exchange agreement with Greenstar, converting approximately C$81.2 million of the principal amount of a promissory note into 9,111,549 exchangeable shares. This resulted in the cancellation of the remaining principal amount of the promissory note and an overall reduction in debt on the company’s balance sheet by C$100 million. Following the transactions, CBG and Greenstar now hold an aggregate of 26,261,474 exchangeable shares.

As a result of these changes, the board of directors has been reconstituted, with three members resigning and the board now comprising David Lazzarato, Willy Kruh, Theresa Yanofsky, Luc Mongeau, and David Klein as the CEO.

These changes mark an important step forward for Canopy Growth as it continues to advance its strategy. The company is focused on maintaining a positive relationship with its largest shareholder, CBI, and further advancing its strategy with the acquisitions of Wana, Jetty, and Acreage.

The amendments and exchanges have significantly impacted the company's balance sheet, with the elimination of short-term debt and a reduction in overall debt balance by C$100 million, demonstrating a strong effort to strengthen the financial position of the company. As a result of these announcements, the company's shares have moved 1.3% on the market, and are now trading at a price of $7.93. Check out the company's full 8-K submission here.

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